Mass Marketing Fraud: Easy Money Today, Jail Tomorrow
As communications technology has developed and people have become increasingly interconnected, massive fraud schemes have become more common. These schemes can take many different forms but they all share a common goal: to illegally obtain money, goods and valuables from people through the use of organized deceit.
What is Mass Marketing Fraud?
Mass marketing fraud can be thought of as a number of fraud schemes committed together under the direction of a central group. For example, a single fraud case might consist of deceiving one victim into sending money to a fraudster. A mass marketing fraud operation can commit hundreds of these frauds at one time, netting millions for criminals.
Types of Mass Marketing Fraud
There are three main types of mass marketing fraud: advance-fee schemes, financial schemes and bogus investments. Each fraud type shares common characteristics with the other types but the details of their commission can vary greatly.
As the name suggests, these schemes operate by persuading victims to send the fraudster money or valuables in exchange for goods, services or prizes that are never actually delivered.
A common example: A person receives an email or phone call informing them that they have won a lottery or prize drawing. The person is told to send a small service fee so that their winnings can be shipped to them. The fraudster receives the money and relocates to a new area to commit new scams.
According to the Texas Penal Code, these frauds attempt to obtain personal banking and financial account data from victims by using deceit and trickery. For example, a fraudster may contact a victim, claiming to be an employee of the victim’s bank and say that they need the victim’s bank account information to correct an error on a recent statement. If the person provides the information, the fraudster can have unrestricted access to their accounts and financial data.
Known as “pump-and-dump” schemes or “short-selling” schemes, these frauds involve the dissemination of false information to cause a stock price to rise or fall. The stock can then be sold or bought to the advantage of the fraudster.